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Is Human Capital a Significant Determinant of Portugal’s FDI Attractiveness?

Author

Listed:
  • Ana Teresa Tavares

    () (CEMPRE, Faculdade de Economia, Universidade do Porto)

  • Aurora A.C. Teixeira

    () (CEMPRE, Faculdade de Economia, Universidade do Porto)

Abstract

The paper tests whether human capital is a relevant foreign direct investment (FDI) determinant. Drawing on a large-scale survey of firms located in Portugal, and controlling for firms’ structural (i.e. size, age and industry), strategic (R&D and export intensities) and linkages (density of university contacts) variables, our key finding is that, indeed, human capital exerts a positive and significant influence on FDI attraction. Relevant policy implications emerge from the results of this study, at two main levels: (i) policies intended to stimulate human capital formation; and (ii) as regards FDI-focused policies. These policies are discussed in the light of the Portuguese case.

Suggested Citation

  • Ana Teresa Tavares & Aurora A.C. Teixeira, 2006. "Is Human Capital a Significant Determinant of Portugal’s FDI Attractiveness?," FEP Working Papers 211, Universidade do Porto, Faculdade de Economia do Porto.
  • Handle: RePEc:por:fepwps:211
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Foreign direct investment (FDI); multinational enterprises (MNEs); human capital; education; skills; R&D-performing firms.;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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